2023 (6) TMI 712 - AT - Customs

Tribunal overturns re-fixing of transaction value, citing procedural flaws and lack of evidence.

M/s. R.K. Industries - IV Versus Commissioner of Customs, Tuticorin

M/s. R.K. Industries - IV Versus Commissioner of Customs, Tuticorin - TMI Issues involved:The issues involved in the judgment are the re-fixing of transaction value by the Valuation Committee affecting duty drawback benefit claimed by the appellant and the legality of such re-fixing under the Customs Valuation Rules, 2007.Issue 1: Re-fixing of transaction value by the Valuation CommitteeThe appellant, a registered exporter of garments, exported 100% Cotton Woven/Knitted T-Shirts under the duty drawback scheme. The Revenue, upon examination, found discrepancies in the declared transaction value. The Valuation Committee, comprising departmental officers, re-fixed the transaction value based on various factors. The appellant challenged this re-fixing, leading to a Writ Petition and subsequent adjudication. The adjudicating authority upheld the re-fixed value, leading to an appeal before the Commissioner (Appeals) and eventually to the present appeal.Issue 2: Legality of the Valuation Committee's re-fixingThe key question before the Tribunal was whether the re-fixing of transaction value by the Valuation Committee was sustainable in the eye of the law. The appellant argued that the rejection of declared value without following Rule 8 of the Customs Valuation Rules, 2007 was improper. They contended that the transaction value, being the price actually paid or payable for the goods, should have been accepted. The Revenue, however, supported the findings of the lower authorities, emphasizing the correctness of the re-fixed value by the Valuation Committee.Judgment:The Tribunal analyzed the contentions of both parties and reviewed the relevant provisions of the Customs Valuation Rules, 2007 and the Customs Act, 1962. They found that the rejection of the transaction value by the Revenue lacked justification and adherence to Rule 8 procedures. The Tribunal highlighted that the Valuation Committee's composition and lack of expert representation raised concerns. Additionally, they noted the absence of evidence supporting the allegation of abnormal transaction value. Consequently, the Tribunal held that the re-fixing of the transaction value by the Valuation Committee was unfounded and not in line with legal principles. As a result, the appeal was allowed in favor of the appellant.Separate Judgment:No separate judgment was delivered by the judges in this case.